2022 (7) TMI 426 - Tri - Insolvency and Bankruptcy

Liquidation of the Corporate Debtor - Section 33(1), 33(2) and 34(1) of the Insolvency and Bankruptcy Code, 2016 (IBC, 2016) - HELD THAT - In the present case two Resolution Plans were received, but the same were not approved by the CoC. The applicant in support of the present application has annexed relevant documents which include copy of the Minutes of the various Meetings of the CoC conducted by the RP. In the 11th meeting of the CoC, Union Bank of India, being the sole member of the CoC, passed resolution for Liquidation of the Corporate Debtor. The liquidation of the Corporate Debtor is ordered - application allowed.

Summary

Issues:
Liquidation of Corporate Debtor M/s. Greendiamz Biotech Ltd. under Sections 33(1), 33(2), and 34(1) of the Insolvency and Bankruptcy Code, 2016 (IBC, 2016).

Detailed Analysis:

1. Admission of Application and Appointment of RP:
The Adjudicating Authority had earlier admitted an application by a Financial Creditor for Corporate Insolvency Resolution Process (CIRP) of the Corporate Debtor. Mr. Chandra Prakash Jain was appointed as the Interim Resolution Professional (IRP) and later as the Resolution Professional (RP) to complete the CIRP.

2. Claims and Committee of Creditors (CoC):
Public announcements were made inviting claims from creditors, and the IRP received claims from Financial and Operational Creditors. The CoC was constituted, with Union Bank of India as the sole member.

3. Invitation for Resolution Plans:
An Expression of Interest (EoI) for submission of Resolution Plan was published, and two Resolution Applicants submitted their plans. However, the CoC did not approve any plan, leading to a resolution for liquidation of the Corporate Debtor.

4. Decision for Liquidation:
The CoC passed a resolution for liquidation after considering the submitted Resolution Plans. The Applicant provided relevant documents supporting the liquidation decision, including minutes of CoC meetings.

5. Appointment of Liquidator:
The Tribunal allowed the application for liquidation and ordered the liquidation of the Corporate Debtor. A Liquidator was appointed as the RP was not willing to take up the role. The Liquidator was directed to complete the liquidation process as per the IBC and related regulations.

6. Operational Details and Powers:
Upon liquidation, the powers of the Board of Directors and key managerial persons ceased to exist, transferring to the Liquidator. The Liquidator was instructed to explore selling the Corporate Debtor as a going concern and was granted the authority to manage legal proceedings on behalf of the Corporate Debtor.

7. Procedural Directives:
The Liquidator's fees were specified to be paid from the proceeds of the liquidation estate. Legal proceedings against the Corporate Debtor were restricted once the liquidation process commenced, with exceptions as approved by the Adjudicating Authority.

8. Notification and Discharge:
The liquidation order served as a notice of discharge to officers, employees, and workmen of the Corporate Debtor, except for ongoing business activities managed by the Liquidator. The Registry was directed to upload and send copies of the order to relevant parties.

9. Conclusion:
The Tribunal disposed of the application, confirming the liquidation of the Corporate Debtor and outlining the responsibilities and procedures to be followed during the liquidation process.